Congressmen Back Bankers Seeking Patriot Act Clarifications

By Armie Margaret Lee
Forty-six congressmen, including six from South Florida, are adding their voices to a growing clamor among banking professionals for clarification of the Patriot Act.

In a letter sent April 22 to federal banking agencies and the Financial Crimes Enforcement Network, legislators cited reports pointing to a lack of consistency in the implementation of Title III of the Patriot Act that "may be creating results that are both counterproductive and damaging to the banking industry."

A spokesman for Rep. Shaw said the Fort Lauderdale congressman thinks that "without clarification of these laws, community and independent bankers will continue to suffer undue administration and competitive burdens."

The legislators said they are concerned about reports that enforcement has resulted in the closing of legitimate money-service businesses and defensive compliance by banks.

"There’s a need for clarity, consistency and less subjectivity in applying the rules," said Alex Sanchez, chief executive of the Florida Bankers Association in Tallahassee. "Bankers want to comply with the Bank Secrecy Act and the Patriot Act. We want to catch money launderers and terrorists, no question about it. We’re doing our part in the war against terror," he said this week.

Mr. Sanchez said the association and the California Bankers Association will have a series of talks May 17-19 in Washington with federal officials "to keep pushing this agenda."

Enacted in the wake of the Sept. 11, 2001, terrorism attacks, the Patriot Act is aimed at preventing criminal financial activities and terrorist financing. It requires all financial institutions to put in place an anti-money-laundering program and report any suspicious activity and transactions.

The tightened regulations have triggered a spate of defensive suspicious-activity reports, Mr. Sanchez said, as well as the closure of several money-service businesses, whose survival is dependent on banks.

Regulators Tuesday issued interpretive guidance aimed at helping banks assess and minimize risks posed by money services. According to a joint statement issued by federal financial officials, including the Office of the Comptroller of the Currency and the Office of Thrift Supervision, the Financial Crimes Enforcement Network "and the federal banking agencies confirm that banking organizations have the flexibility to provide banking services to a wide range of money services while remaining in compliance with the Bank Secrecy Act."